Part 5 — $22 Million Worth of Reasons Why It Pays to Comply with Regulatory Organizations

So far in this series we’ve discussed four different organizations who have cumulatively racked up nearly $7.3 million in fines. Just to recap, we’ve seen:

  • A financial services firm penalized for failing to incorporate adequate business continuity measures
  • A cardiac care clinic called out for publicly posting patient appointments online
  • A financial giant caught overcharging its customers and failing to provide required notices
  • A healthcare practice chastised for refusing to provide its patients with copies of their medical records

This next organization tips the scale, so to speak, receiving the largest fine out of all the companies included in this series.

Morgan Stanley — $15 million


As you’ve already seen in Part 1, Morgan Stanley is no stranger to regulatory fines. In 2002 Morgan Stanley, along with four other firms, was fined $8.3 million for not complying with the Securities and Exchange Commission’s (SEC’s) email retention policies.

History repeated itself in 2006 when the firm failed to produce thousands of copies of emails in relation to an investigation into the firm’s Wall Street business practices. When Morgan Stanley was unable to come up with the emails, the SEC produced a $15 million fine for the firm.

The Takeaway


While each of these organizations mentioned in this series found itself in hot water with regulatory authorities for slightly different reasons, there is one important lesson companies can learn from each of these examples: When it comes to regulatory requirements, it pays to comply.

The next time your business is tempted to cut corners, take a look at the number of zeroes listed in these real-life scenarios. The fines totaled more than $22 million. Is that in your company’s budget?

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